· Asia’s base oils supply shows signs of staying balanced-to-tight.· Arbitrage stays hard to work for shipments to more distant outlets like Mideast Gulf, Europe and Americas.· Trend points to tighter surplus supply.· Trend means any pick-up in supply would be harder to clear at current price levels.· Asia’s rising Group I/II heavy-grade premium to diesel prices incentivizes refiners to boost output of those grades.· China’s Group II light-grade premium to diesel holds firm but well below year-earlier levels, curbing incentive for refiners to raise output sharply..· Asia’s Group I supply set to remain tight amid recent, upcoming plant maintenance work, slump in supplies from Japan.· Asia’s Group II supply likely to improve over the coming weeks following tighter-than-expected availability in recent weeks.· Taiwan’s base oils exports likely fell sharply in Feb 2024 from the previous month.· Singapore’s base oils exports show signs of falling in Feb 2024 from the previous month..· Singapore sees ongoing pause in supplies from China and Japan in Jan-Feb 2024..· Drop in supplies coincides with plant maintenance in Thailand, adding to tight availability of Group I base oils.· Tight Group I supply keeps arbitrage open to import supplies from Europe.· Cargo originating from Greece reaches Singapore in late-Feb 2024.· Shipment follows arrival of cargo from Russia the previous week.· Surplus supply of Group I base oils from Europe likely to tighten in coming weeks once a Group I plant in Italy closes and demand gets a seasonal boost..· Japan’s January base oils supply falls to lowest since late-2021 amid simultaneous drop in domestic production and imports..· Lower supply follows closure of two base oils plants in Japan since 2H 2022.· Lower supply is one factor behind firmer Group I base oils prices and tighter availability in the Asia-Pacific region in recent months.· Lower supply highlights Japan’s growing reliance on base oils from overseas markets to cover more of its requirements.· Growing reliance on overseas supplies increases impact of factors like plant maintenance work in markets like South Korea.· Major Group III plant maintenance set to take place in South Korea work starting in March 2024..· Japan’s lower supplies continue to slash exports to outlets like Singapore and South Korea..· Trend compounds Group I supply tightness throughout Asia-Pacific region.· Trend forces overseas buyers to seek to maximise Group II base oils consumption if possible, or to seek Group I supplies from other sources like Europe.· Any supplies from Europe to Asia incur an even longer travel time because of shipment via southern Africa rather than Suez Canal..· India’s January base oils output slips to four-month low, falls from year-earlier levels for second month..· Trend contrasts with surge in India’s base oils output in Q1 2023.· Drop in domestic output boosts buyers’ need to tap overseas markets to cover more of their requirements..· India’s base oils imports from Saudi Arabia show signs of holding firm in Feb 2024 following arrival of shipments that loaded at end-Jan 2024.· Shipments for March arrival from Saudi Arabia could be lower after exports from the country show signs of falling in Feb 2024 compared with the previous two months.· Trend raises prospect of buyers needing to line up supplies from alternative sources..Asia base oils demand outlook: Week of March 4.Global base oils margins outlook: Week of March 4.Global base oils demand outlook: Week of March 4.Global base oils arb outlook: Week of March 4.Global base oils cargo flows: Week of March 4
· Asia’s base oils supply shows signs of staying balanced-to-tight.· Arbitrage stays hard to work for shipments to more distant outlets like Mideast Gulf, Europe and Americas.· Trend points to tighter surplus supply.· Trend means any pick-up in supply would be harder to clear at current price levels.· Asia’s rising Group I/II heavy-grade premium to diesel prices incentivizes refiners to boost output of those grades.· China’s Group II light-grade premium to diesel holds firm but well below year-earlier levels, curbing incentive for refiners to raise output sharply..· Asia’s Group I supply set to remain tight amid recent, upcoming plant maintenance work, slump in supplies from Japan.· Asia’s Group II supply likely to improve over the coming weeks following tighter-than-expected availability in recent weeks.· Taiwan’s base oils exports likely fell sharply in Feb 2024 from the previous month.· Singapore’s base oils exports show signs of falling in Feb 2024 from the previous month..· Singapore sees ongoing pause in supplies from China and Japan in Jan-Feb 2024..· Drop in supplies coincides with plant maintenance in Thailand, adding to tight availability of Group I base oils.· Tight Group I supply keeps arbitrage open to import supplies from Europe.· Cargo originating from Greece reaches Singapore in late-Feb 2024.· Shipment follows arrival of cargo from Russia the previous week.· Surplus supply of Group I base oils from Europe likely to tighten in coming weeks once a Group I plant in Italy closes and demand gets a seasonal boost..· Japan’s January base oils supply falls to lowest since late-2021 amid simultaneous drop in domestic production and imports..· Lower supply follows closure of two base oils plants in Japan since 2H 2022.· Lower supply is one factor behind firmer Group I base oils prices and tighter availability in the Asia-Pacific region in recent months.· Lower supply highlights Japan’s growing reliance on base oils from overseas markets to cover more of its requirements.· Growing reliance on overseas supplies increases impact of factors like plant maintenance work in markets like South Korea.· Major Group III plant maintenance set to take place in South Korea work starting in March 2024..· Japan’s lower supplies continue to slash exports to outlets like Singapore and South Korea..· Trend compounds Group I supply tightness throughout Asia-Pacific region.· Trend forces overseas buyers to seek to maximise Group II base oils consumption if possible, or to seek Group I supplies from other sources like Europe.· Any supplies from Europe to Asia incur an even longer travel time because of shipment via southern Africa rather than Suez Canal..· India’s January base oils output slips to four-month low, falls from year-earlier levels for second month..· Trend contrasts with surge in India’s base oils output in Q1 2023.· Drop in domestic output boosts buyers’ need to tap overseas markets to cover more of their requirements..· India’s base oils imports from Saudi Arabia show signs of holding firm in Feb 2024 following arrival of shipments that loaded at end-Jan 2024.· Shipments for March arrival from Saudi Arabia could be lower after exports from the country show signs of falling in Feb 2024 compared with the previous two months.· Trend raises prospect of buyers needing to line up supplies from alternative sources..Asia base oils demand outlook: Week of March 4.Global base oils margins outlook: Week of March 4.Global base oils demand outlook: Week of March 4.Global base oils arb outlook: Week of March 4.Global base oils cargo flows: Week of March 4
